Reagan To Ask .5% Rise In Medicare Payments

May 29, 1986|The New York Times

Washington -- The Reagan administration will soon prpose an incrase of 0.5 percent in Medicare payments to hospitals for the treatment of patients who are elderly or disabled, federal health officials said Wednesday.

The proposed increase, for the fiscal year that starts Oct. 1, is substantially less than the increase that would be needed to keep pace with inflation, according to hospital administrators and advocates for the elderly.

But officials at the Office of Management and Budget contend that data on hospital costs would actually justify a freeze, or slight reduction, in the payments to hospitals.

The new rates are to be announced later this week and published Monday in The Federal Register for public comment. The final rules must be issued by Sept. 1 and would apply to all Medicare patients discharged from hospitals after Oct. 1.

Just four months ago, in the budget for the fiscal year 1987, the Reagan administration estimated that there would be a 2 percent increase in payments to hospitals for treatment of Medicare beneficiaries.

Edmund B. Rice, vice president of the American Hospital Association, which represents more than 6,000 hospitals, said Wednesday that the proposed increase in Medicare payments was ``far below the price increases that hospitals have been experiencing.``